The Democratic Republic of Congo (DRC) economy is driven by agriculture, mineral resources, manufacturing and services. Over the past decade, the agricultural sector has been declining as the country’s major contributor to its GDP while commodities-related industries have been rising. The mining sector accounts for one-quarter of the country’s GDP which makes the country extremely vulnerable to commodity prices.

Most of the world’s cobalt comes from the DRC, which is racked by political instability, legal opacity and, at its darkest, child labor in its mines. This concentration of supply risk, both in terms of physical units and ethical sourcing, isn’t going away any time soon and could even worsen.

Yet, despite these risks, cobalt price continues to rise steadily. Since early 2016, the price of cobalt has more than tripled to over US$36 a pound, the highest level in 10 years.

It’s price has been buoyed by recent announcements by governments around the world, including the UK and China, of their plans to switch from petrol and diesel vehicles to electric cars. You can’t power an electrical vehicle without a lithium-ion battery and, for now at least, you can’t make a battery without using cobalt. Each battery containing an estimated 5-15kg of the metal.

The DRC accounted for 66,000 tonnes of global mined cobalt production of 123,000 tonnes last year, according to the U.S. Geological Survey. By 2030, global cobalt demand is anticipated to be nearly 50 times higher than what it currently is, and the Democratic Republic of Congo (DRC) is home to more than 60% of the world’s cobalt reserves.

Increasing consumption of battery metals will be driven by the more than 20 mega battery manufacturing plants that are currently being planned or constructed globally, including the gigafactory that Tesla Motors Ltd. and partner Panasonic Corp. has built in Nevada to support planned production of 500,000 electric cars annually.

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