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Tuesday, May 06, 2025
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California Surpasses Japan to Become the World’s Fourth-Largest Economy
California has overtaken Japan to become the fourth-largest economy in the world, Governor Gavin Newsom announced, warning of the risks posed by federal tariffs on the state’s thriving tech industry.
According to preliminary data from the U.S. Bureau of Economic Analysis, California’s nominal GDP reached 4.1 trillion dollars in 2024, surpassing Japan’s nominal GDP of 4.02 trillion dollars. This places California behind only the United States as a whole, China, and Germany in terms of economic size. California also outpaced all three in growth rate last year, posting a 6.6 percent increase.
“California is not just keeping pace with the world — we are setting the pace,” Governor Newsom said on Wednesday. “Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation.” However, Newsom warned that the state’s economic strength is under threat from “the reckless tariffs imposed by the current federal administration.” He stated, “California’s economy drives the nation, and it must be protected.”
California, the most populous U.S. state with more than forty million residents, accounted for approximately fourteen percent of the nation’s GDP in 2024, largely driven by Silicon Valley as well as its real estate and financial sectors.
Last week, Newsom filed a lawsuit against former President Donald Trump over his use of emergency powers to impose high tariffs unilaterally, actions the governor claims are harming families and businesses across California. Filed in federal court on April sixteenth, the lawsuit argues that Trump lacked the authority to impose tariffs against Mexico, China, and Canada, as well as a sweeping ten percent tariff on imports from the rest of the world.
According to the lawsuit, these tariffs have caused “immediate and irreparable harm to California — the state with the largest economy, manufacturing base, and agricultural sector in the country” by “disrupting supply chains, inflating prices, and causing billions of dollars in damages.” The complaint asserts that Trump’s use of the International Emergency Economic Powers Act to impose tariffs is “unlawful and unprecedented,” and contends that actions of such magnitude require congressional approval.
“California is not just keeping pace with the world — we are setting the pace,” Governor Newsom said on Wednesday. “Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation.” However, Newsom warned that the state’s economic strength is under threat from “the reckless tariffs imposed by the current federal administration.” He stated, “California’s economy drives the nation, and it must be protected.”
California, the most populous U.S. state with more than forty million residents, accounted for approximately fourteen percent of the nation’s GDP in 2024, largely driven by Silicon Valley as well as its real estate and financial sectors.
Last week, Newsom filed a lawsuit against former President Donald Trump over his use of emergency powers to impose high tariffs unilaterally, actions the governor claims are harming families and businesses across California. Filed in federal court on April sixteenth, the lawsuit argues that Trump lacked the authority to impose tariffs against Mexico, China, and Canada, as well as a sweeping ten percent tariff on imports from the rest of the world.
According to the lawsuit, these tariffs have caused “immediate and irreparable harm to California — the state with the largest economy, manufacturing base, and agricultural sector in the country” by “disrupting supply chains, inflating prices, and causing billions of dollars in damages.” The complaint asserts that Trump’s use of the International Emergency Economic Powers Act to impose tariffs is “unlawful and unprecedented,” and contends that actions of such magnitude require congressional approval.
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