California Overtakes Japan To Become World’s Fourth Largest Economy.
California has surpassed Japan to become the fourth largest economy in the world, according to newly released data from the International Monetary Fund (IMF) and the US Bureau of Economic Analysis.
The figures reveal that California’s gross domestic product (GDP) reached $4.10 trillion (£3.08 trillion) in 2024, nudging past Japan’s $4.01 trillion. The Golden State now sits behind only Germany, China, and the United States as a whole in the global economic rankings.
Governor Gavin Newsom hailed the development as a testament to California’s economic strength and innovation. “California isn’t just keeping pace with the world – we’re setting the pace,” he stated.
The state leads the United States in both manufacturing and agricultural output and is a global hub for technological innovation, entertainment, and trade. It is also home to the country’s two busiest seaports, further underpinning its economic influence.
However, Newsom expressed concern over the potential impact of federal trade policies on the state’s continued growth. He has been a vocal critic of President Donald Trump’s sweeping tariffs, which have sparked trade tensions with multiple countries, including a high-stakes trade war with China.
The Trump administration has implemented a 10% levy on most imports into the US, with some tariffs – particularly those on Chinese goods – rising as high as 145%. In retaliation, China imposed a 125% tariff on American exports. The administration argues that these measures are designed to revive domestic manufacturing and bring jobs back to the US.
Newsom, a Democrat and considered a likely contender in the 2028 presidential race, has filed a lawsuit challenging the president’s authority to impose such levies. “While we celebrate this success, we recognise that our progress is threatened by the reckless tariff policies of the current federal administration,” he warned. “California’s economy powers the nation, and it must be protected.”
The economic data also highlights California’s strong momentum: it is the fastest-growing economy among the top five. The United States leads globally with a GDP of $29.18 trillion, followed by China at $18.74 trillion and Germany at $4.65 trillion.
Japan, which has slipped to fifth place, continues to grapple with the challenges of an ageing and shrinking population, contributing to a decline in economic output and rising social care costs.
Despite the headwinds, California’s rise is being seen as a powerful indicator of its resilience and leadership in the global economy.
