Cluster of 20 omicron cases hits Tianjin, a gateway city to Beijing

Mass testing is underway today for the 14 million residents of Tianjin. It urban area borders on Beijing in what could be a huge problem for China.

There’s no travel history for the cluster of cases, which were detected in a school.

“The
community spread may have been taking place for a certain period of
time, although the cases were only discovered early [Saturday] morning,” Tianjin Centre of Disease Control and Prevention Zhang Ying said on Saturday.

With the Beijing winter Olympics less than a month away, the outbreak will cause grave concern. All residents have been told not to leave the city but no lockdown order has yet been given.

The overall situation continues to deteriorate. Xian is entering its third week of total lockdown and local cases are appearing all over the country.

The outbreak in Hong Kong is proving extremely difficult to contain with a second unlinked cases found over the weekend and 33 cases total on Sunday, though 27 were imported. All the more embarrassing is that the outbreak is centered on a birthday party for Witman Hung Wai-man, a local deputy to the National People’s Congress. High-ranking officials and lawmakers were among guests.

In Shenzhen, a close contact of one of the two epidemiologically linked Delta infections detected the previous day tested positive. That city also rolled out city-wide testing over the weekend.

Overall, there were 92 cases of local transmission on the day.

Market consequences

The market has been blissfully unaware of the growing risks to global growth from China over the past month. The rest of the world is learning to live with covid — and that’s great — but China is showing no leniency in its covid-zero approach.

It was a successful approach in previous waves but omicron is one of the fastest-spreading viruses in human history and it will be impossible to keep out of China forever.

If China continues down the path of Xian-style lockdowns it could have severe consequences on domestic and global growth, adding to the pressure on supply chains.

At some point the market will focus on that equation and it will be a constant headwind until China pivots towards a strategy of living with covid or miraculously keeps covid out long enough for the virus to fall to extremely low levels globally.