Smuggling of ivory, gold and timber worth over a billion dollars a year is fuelling war by funding dozens of rebel groups in Democratic Republic of Congo, a UN report warned Friday.

"Militarised criminal groups with transnational links are involved in large-scale smuggling" of "gold, minerals, timber, charcoal and wildlife products such as ivory" of up to $1.3 billion each year from eastern DR Congo, the UN Environment Programme (UNEP) said.

The revenues finance at least 25 armed groups -- but up to 49 according to some estimates -- that "increasingly fuel the conflict" in the war-torn region, the report read.

Control over the mineral-rich areas is a key factor in the conflicts that have raged in eastern DR Congo for decades.

"These resources lost to criminal gangs and fuelling the conflict could have been used to build schools, roads, hospitals and a future for the Congolese people," said Martin Kobler, UN chief in DR Congo, and head of the 20,000-strong UN peacekeeping force, MONUSCO.

Gold forms the largest section, with organised crime gangs earning up to $120 million a year from the trade.

The vast majority of income earned goes outside the impoverished region, but the estimated two percent that goes to the armed groups, some $13 million a year, provides the funds to prolong war.

"This income represents the basic subsistence cost for at least 8,000 armed fighters per year, and enables defeated or disarmed groups to continuously resurface and destabilise the region," the report read.

Criminal gangs use their cash to push a strategy of "divide and rule" among the rebel groups, to ensure no one rebel force can dominate and take over the trade, the report added.

DR Congo has massive resources of gold, copper and cobalt but also diamonds, iron, nickel, manganese, bauxite, uranium and cassiterite, the most important source of tin. However most of the country's people live in poverty.

Much of the rebel activity consists of abuses against civilians and illegal exploitation of natural resources.