CA's Economy Is Now Larger Than All But These 3 Countries

CALIFORNIA — California now has the fourth largest economy in the world.

Gov. Gavin Newsom's office announced Thursday that the Golden State has overtaken Japan to become the fourth-largest economy, according to newly released data from the International Monetary Fund and the U.S. Bureau of Economic Analysis.

The data shows California's nominal GDP reached $4.1 trillion, surpassing Japan's $4.02 trillion. That places the state behind only the U.S. at $29.18 trillion, China at $18.74 trillion, and Germany at $4.65 trillion in global economic rankings.

"California isn't just keeping pace with the world — we're setting the pace," Newsom said in a statement. "Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation."

California's economy is growing at a faster rate than the world's top three economies, according to data. The state's GDP grew at a rate of 6% in 2024, outpacing the country's 5.3% rate, China's 2.6% rate and Germany's 2.9% rate.

Newsom credited the state's new ranking to a growing population and record tourism spending. He noted that California is the country's top state for new business ventures, as well as the strength of the state's agricultural, high-tech and manufacturing centers.

California surpassed France in 2016 to become the sixth largest economy in the world. The Golden State became the fifth largest economy in 2017 and held that spot for seven consecutive years, according to the governor's office.

Last summer, California became home to the most Fortune 500 companies in the country. The Golden State, with 57 of the nation's largest companies, claimed first place for the first time since 2014, according to Fortune. California beat both Texas and New York, which tied for second place with 52 companies each.

While celebrating the latest milestone, Newsom noted that President Donald Trump's broad-sweeping tariffs threaten the state's growth.

"And, while we celebrate this success, we recognize that our progress is threatened by the reckless tariff policies of the current federal administration," he said. "California's economy powers the nation, and it must be protected."

Newsom's office filed a lawsuit last week in federal court to challenge Trump's authority to enact tariffs without the support of Congress. The tariffs have disrupted supply chains, inflated costs for the state and residents, and inflicted billions in damages on California's economy, his office said.