(Bloomberg) — California Governor Gavin Newsom boasted that his state has become the world’s fourth-largest economy, following only the US, China and Germany in global rankings.
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The state’s nominal gross domestic product reached $4.1 trillion last year, edging past Japan’s $4.02 trillion, Newsom said in a statement, citing newly released International Monetary Fund country-level data and preliminary state data from the US Bureau of Economic Analysis.
“California isn’t just keeping pace with the world — we’re setting the pace,” Newsom said. “Our economy is thriving because we invest in people, prioritize sustainability and believe in the power of innovation.”
The Democratic governor is leveraging the state’s economic heft to challenge President Donald Trump’s trade and other policies, portraying California as a global economic force positioned to resist federal actions he says could harm key industries.
California’s more than $4 trillion economy accounts for about 14% of US GDP, with the real estate, finance and technology sectors among the top contributors, according to the Public Policy Institute of California. After years of declines, California’s population grew by roughly 250,000 people last year, driven by a rebound in births and gains from international migration — though the total remains below pre-pandemic levels.
Newsom has argued that the state has the most to lose from tariffs because of the size of its industries. Last week he sued the Trump administration over his tariff hikes, arguing that the Republican president lacks the authority to implement it without congressional approval. He vowed to negotiate with foreign leaders in an effort to spare California businesses from retaliatory tariffs.
“While we celebrate this success, we recognize that our progress is threatened by the reckless tariff policies of the current federal administration,” Newsom, a potential presidential candidate in 2028, said in the statement. “California’s economy powers the nation, and it must be protected.”
The IMF this week sharply lowered its forecasts for world growth this year and next, warning the outlook could further deteriorate as Trump’s tariffs spark a global trade spat. The IMF cut its global growth forecast this year to 2.8% in its updated World Economic Outlook, which is lower than the fund’s forecast in January for a 3.3% growth rate. The US economy is projected to expand 1.8% in 2025, almost a percentage point lower that the fund’s previous forecast.
