California Gov. Gavin Newsom announced on April 23 that California had the fourth-largest economy in the world in 2024, overtaking Japan.
According to Newsom’s spokeswoman, Tara Gallegos, the governor used preliminary estimates of nominal gross domestic product (GDP) for 2024, issued by the U.S. Bureau of Economic Analysis (BEA).
Nominal GDP measures the value of goods and services for a state or country using current market prices and is not adjusted for inflation. In contrast, real GDP data is adjusted for inflation.
In addition to BEA data, Newsom cited data released on April 22 by the International Monetary Fund (IMF) ranking each country according to its GDP.
In an April 23 statement, Newsom said California’s economy ranked fourth-largest internationally, behind the United States as a whole ($29.2 trillion), China ($18.7 trillion), and Germany ($4.7 trillion).
Newsom said that the state’s 6 percent economic growth in 2024 was a “faster rate than the world’s top three economies.”
The governor touted the strength of the state’s agriculture, high-tech, and manufacturing sectors.
“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.”
University of Southern California professor of business management Michael Mische, however, said California’s ranking has more to do with how other economies did last year.
“California’s number four position has more to do with the poorly performing ... economies of Japan and Germany than it does with any in-state specific initiatives,” Mische told The Epoch Times.
California’s economy grew by 13.3 percent from 2019 to 2024, while Japan’s economy saw only a 0.9 percent increase and Germany’s was only 0.3 percent, Mische said.
“So, Japan and Germany grew at less than 1% for the 2019 to 2024 period in real GDP terms,” he said.
Japan has suffered from a prolonged state of decline, and Germany is enduring high labor and energy costs, he added.
Marshall Toplansky, an associate professor and faculty fellow in innovation at Chapman University’s College of Business and Economics, noted that tariffs could slow California’s economy.
“The interesting question here is whether the impact of tariffs will change this,“ Toplansky told The Epoch Times. ”I think we will be feeling a slowdown in trade if the tariffs continue at high levels.”
The issue is how high the tariffs will be and how long they will last, he added.
“The ports of Los Angeles and Long Beach will very likely see a drop in volume, and it is not clear to what extent they will hurt overall GDP for the state,” Toplansky said.
