China's Omicron-hit Tianjin launches new round of tests

The Chinese city of Tianjin started a new round of testing of its 14 million residents on Wednesday to block the Omicron variant, as financial analysts warned of the growing economic costs on China of curbs to extinguish clusters of infections.

China, which has stuck to what is effectively a "zero-COVID" policy, is scrambling to prevent the spread of the highly infectious Omicron variant ahead of the Lunar New Year holiday later this month and as Beijing prepares to stage the Winter Olympics from Feb. 4.

Japanese automaker Toyota said operations at its joint-venture factory in Tianjin had been halted since Monday due to the impact on its suppliers of mandatory coronavirus testing of Tianjin residents.

"We plan to resume operations as soon as the government's instructions and the safety and security of the local community and suppliers are confirmed and assured," Toyota said in a statement to Reuters.

Tianjin, about 100 km (62 miles) southeast of Beijing, reported 33 domestically transmitted coronavirus infections with confirmed symptoms for Tuesday, up from 10 the day before, national data showed.

The city ordered a half-day off for employees at companies and other institutions on Wednesday and required them to keep activities "relatively static" to comply with the city's second round of mass testing, the local government said in a statement.

In the central province of Henan, the city of Anyang, where Omicron has also been detected in the community, reported 65 local symptomatic cases on Tuesday, a surge from just two a day earlier.

A vice premier, Sun Chunlan, visited Henan and said Omicron presented a challenge to the city's virus control efforts.

Officials should "further increase the efficiency of testing and epidemiological investigation and adopt strict community-level control measures", the official Xinhua news agency quoted her as saying in a report late on Tuesday.

Case numbers in Tianjin and Anyang are tiny compared with outbreaks in many other countries, with the total number of Omicron infections unclear.

Tianjin has made it harder for people to leave town, while Anyang, has ordered residents to remain indoor during mass testing, unless for essential jobs or for their tests.

China is likely to see ramped-up virus restrictions to contain Omicron, Goldman Sachs analysts said in a note, revising down their 2022 growth forecast to 4.3% from 4.8% previously, citing economic costs from the potentially intensified measures.

Analysts at Morgan Stanley also said they saw downside risk to their first-quarter growth forecast this year, as Omicron could "imply more costs than benefits under China's Covid-zero strategy".

Including infections in Tianjin and Anyang, mainland China reported a total of 166 local symptomatic cases for Tuesday, more than 110 a day earlier.

There were no new deaths, leaving the death toll at 4,636. As of Jan. 11, mainland China had 104,189 confirmed symptomatic cases, including both local ones and those arriving from overseas.