This might sound unbelievable, but it is actually close to reality. In December 2024, Texas Governor Greg Abbott predicted that the State of Texas would surpass France and become the world’s seventh-largest economy, in part thanks to President Trump’s election: “Texas is going to surpass France when the new numbers come out, and we will have the seventh-largest economy in the entire world.” Indeed, Texas’s GDP is 2.7 trillion USD, compared to France’s 3.1 trillion USD, despite a population twice as large.
If Texas were considered an independent country, it would rank among the 10 largest economies, in 8th place, ahead of Italy, Russia, and Canada, whereas California would rank among the top 5, in 4th place. So, what factors account for the state’s overall success?
Texas is a paradise for fossil fuels, the US leader in crude oil and gas production, home to the country’s best refineries, and the largest energy-exporting state. Overall, the energy industry is Texas’s most important economic backbone. With that being said, after Donald Trump’s presidential election, Governor Abbott saw a real chance to expand the state’s wealth, especially with the new president’s ambition of increasing the use of gas and petroleum, referring to the famous phrase: “Drill, baby, drill”. The new order for “unleashing American energy” under Trump strongly promotes energy production and distribution and sets aside regulations implemented under Biden’s presidency. This is a key strategy for Texas’s development and good riddance for the future of the state’s growth. However, the southern state is known not only for its oil and gas reserves but also for renewable energy, being a leader in wind turbine production.
Even though the economy is mainly supported by the energy sector, several big tech companies have relocated their headquarters to Texas. While Silicon Valley was once considered the heart of the startup ecosystem, other places are emerging and slowly taking its place, such as Texas, which has seen over 314 corporate headquarters relocate. This can be understood through financial factors, including tax structures, affordable relocation costs, and lower regulatory barriers, making the “Lone Star State” an advantageous location for growing companies. In fact, the city of Austin is often called “Silicon Hills,” reflecting its significant appeal to many tech giants.
Moreover, Texas is a growing state, both demographically and in terms of job opportunities. It has the fastest population growth rate in the country and is projected to gain 8.6 million inhabitants over the next 25 years. It is also reported that Texas has a lower unemployment rate than most states, with over 2.5 million jobs created under Governor G. Abbott, partially explaining the enthusiasm and attraction of new residents.
Despite the state’s future looking rather promising, some economists, such as Kathryn Anne Edwards, are still expressing concerns, particularly on the economic insecurities of many residents due to a higher poverty rate than the overall rate in the United States. Notably, it ranked first among US states in terms of the number of people in financial distress. The main issue is that the state’s apparent economic strength seems to cover for internal weaknesses and fragilities amongst its residents. Knowing this, we can’t help but wonder whether the federal state will be able to impose itself and take the place of the 7th-largest economy in the world. This is a bold statement, yet plausible given the state’s ever-growing economy. Finally, investigative reporter Russell Gold believes the Lone Star State still has a long way to go before reaching that goal and could even benefit from looking to its European competitors.
By Laura Jacson
SOURCES
https://businessintexas.com/why-texas/economic-strength/
https://fortune.com/2024/12/16/texas-worlds-largest-economies-france-trump-abbott/
https://www.columbian.com/news/2025/aug/09/edwards-the-texas-economy-aint-all-that/
https://techbehemoths.com/blog/why-are-tech-companies-moving-to-texas
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