California overtakes Japan as world’s fourth-largest economy

California has surpassed Japan and would be the world’s fourth-largest economy if it were a country, with nominal GDP reaching USD4.1tr in 2024, according to US government data. The state’s economy expanded by 6% last year, outpacing the United States, China, and Germany. California accounted for 14% of the US economy, driven by growth in technology, real estate, and finance. However, Governor Gavin Newsom warned that escalating tariffs under President Donald Trump threaten the state’s economic momentum. California has filed a lawsuit challenging Trump’s use of emergency powers to impose global tariffs, arguing the move disrupted supply chains, inflated costs, and caused significant financial damage. The state, which traded nearly USD675bn in 2024, cited Mexico, Canada, and China as its top trade partners.