California: California has officially surpassed Japan in becoming the world’s fourth-largest economy, according to new figures released by the International Monetary Fund (IMF) and the US Bureau of Economic Analysis.
The data places California’s 2024 gross domestic product (GDP) at $4.10 trillion (£3.08 trillion), edging ahead of Japan’s $4.01 trillion, and positioning the US state just behind the United States as a whole, China, and Germany.
California Governor Gavin Newsom stated that, “California isn’t just keeping pace with the world- we’re setting the pace.”
California’s economic strength is underpinned by its unique combination of industries. The state boasts the largest share of both manufacturing and agricultural production in the United States.
It is also the global epicenter for technological innovation, home to Silicon Valley, and serves as the heart of the world’s entertainment industry with Hollywood.
Furthermore, California hosts the country’s two largest seaports, the Port of Los Angeles and the Port of Long Beach, further amplifying its influence in global trade.
NEW: According to the IMF’s 2024 World Economic Outlook data released yesterday and BEA data, California’s nominal GDP reached $4.1 trillion, surpassing Japan’s $4.02 trillion, and placing California as the 4th largest economy — behind only the United States, China, and Germany.… pic.twitter.com/YgLliJl4a8
— Governor Newsom Press Office (@GovPressOffice) April 24, 2025
The new economic ranking reflects not only the size of California’s economy but also its impressive growth trajectory. Among the world’s top economies, California was the fastest growing in 2024, outpacing Japan, which is facing a number of structural challenges including an aging and shrinking population and increasing social care costs.
While Governor Newsom praised the economic milestone, he also expressed deep concerns about the federal government’s trade policies under President Donald Trump, warning that ongoing tariff wars threaten California’s financial stability.
Japan, once the world’s second-largest economy, continues to feel the weight of demographic and fiscal pressures.
The IMF this week downgraded its economic forecast for Japan, citing slow wage growth and rising costs from trade disruptions. The World Economic Outlook report noted that “the effect of tariffs announced on April 2 and associated uncertainty offset the expected strengthening of private consumption.”
