California has overtaken Japan to become the fourth-largest economy in the world, according to new data reported by The Guardian. The state’s nominal GDP hit $4.1 trillion, edging past Japan’s $4.02 trillion and placing California behind only the U.S., China, and Germany in global economic rankings.
Governor Gavin Newsom praised the milestone, attributing the state’s success to investments in people, sustainability, and innovation. “Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation,” Newsom said.
Despite ongoing challenges such as homelessness and housing shortages, California’s diverse economy—fueled by technology, entertainment, agriculture, and green energy—has shown resilience and rapid post-pandemic recovery. The jump in economic standing is also partially driven by currency exchange rate shifts affecting Japan’s yen.
Analysts say the development highlights California’s global influence and serves as a counterpoint to recent criticisms of its economic policies.