For the first time in five years, California's economic engine is warming up and expected to accelerate and catch up with the rest of the nation, according to Bob Smiley, dean of the Graduate School of Management at UC Davis. "California's economy is expected to increase 2 to 3 percent over the next two years, which is the anticipated rate of growth for the rest of the country," says Smiley. Agricultural production, tourism and high-tech manufacturing are driving the recovery, Smiley notes. California has done very well in international trade, with the electronics industry and tourism leading the way. "The dollar is still weaker than it was two years ago against most international currencies, making California an attractive vacation spot for many foreign visitors," says Smiley. The Sacramento region is expected to be the "hot spot" in the state for new home construction because of anticipated business development in the area. The southern part of the state is still in a recession, the Bay Area is pulling out of its economic slump and the Central Valley remains virtually untouched, says Smiley.