Canada will abolish many of the retaliatory tariffs it has imposed on imported American products and will step up its engagement with the United States in an effort to forge a new relationship with Washington on trade and security, Prime Minister Mark Carney announced on Friday.

Speaking at a press conference in Ottawa, following a phone call with U.S. President Donald Trump, Carney said that as of September 1, tariffs will be lifted on all goods covered by the U.S.-Mexico-Canada Free Trade Agreement (USMCA). This move comes as a response to exemptions granted by Washington in early August for Canadian products.

However, tariffs on automobiles, steel, and aluminum will remain in place.

Carney noted that the U.S. recently clarified it would not impose tariffs on Canadian products covered under USMCA, calling it a positive development.

“Canada and the U.S. have now restored free trade for most of our goods,” he added, emphasizing that compared to other U.S. trading partners, Canadian exports overall face lower tariffs.

Earlier, the White House welcomed Canada’s decision to scrap the retaliatory tariffs as a goodwill gesture aimed at restarting stalled trade talks.

“We welcome this action from Canada, which was long overdue. We look forward to continuing discussions with Canada on issues related to trade and national security,” the statement added.