After years of speculation over his intentions, Kabila consented to obey the two-term limit imposed by Democratic Republic of Congo's constitution on Wednesday, by not entering his name into a poll set for Dec. 23.
As a parting shot, he picked a hard-core former interior minister, who has been placed under EU sanctions, to stand instead.
But whatever concerns Western powers might have over Kabila's favored successor, Emmanuel Ramazani Shadary -- who is under sanctions for his alleged role in the suppression of protests with live bullets, killing scores of demonstrators -- this wasn't the time to voice them.
"We applaud the decision by President Joseph Kabila to respect the Congolese constitution," said the statement, also signed by Canada and Switzerland. It added that this "constitutes a key stage on the path toward the first peaceful change of power in DRC."
Congo is Africa's top producer of copper and the world's leading miner of cobalt, which is prized for its use in electric car batteries.
Kabila has been in power for 17 years, since his father and predecessor as president, Laurent Kabila, was assassinated in 2001. The only two previous changes of power in Congo have been at the barrel of a gun.
The U.S. State Department had earlier described Kabila's move as "a significant step forward for Congolese democracy."
But State Department spokeswoman Heather Nauert added: "Government, opposition, and civil society leaders, along with the heads of the security services share with President Kabila the responsibility of ensuring full respect for democratic norms."
The joint statement called for "transparent, peaceful and inclusive" elections.
Kabila was due to step down in 2016 at the end of his constitutional mandate. But he stayed on while the election was repeatedly delayed, stoking militia violence and sparking protests in which the security forces killed dozens of people.
Kabila had come under strong pressure from regional allies such as Angola, as well as the United States and EU, to stand down.
(Reporting by Amedee Mwarabu; Additional reporting by Lisa Lambert in Washington; Writing by Tim Cocks; Editing by Mark Trevelyan)