The restrictions are the latest economic blow to an international business hub pursuing a zero-Covid strategy that has kept cases low but left residents cut off from the rest of the world.

Like mainland China, Hong Kong has maintained some of the world's harshest measures throughout the pandemic -- including virtually closed borders, weeks-long quarantines, targeted lockdowns and mass testing.

The city has recorded 114 Omicron cases as of Tuesday evening, with the vast majority identified at the airport or during the 21-day hotel quarantine that is mandatory for most arrivals.

But a small community outbreak traced to Cathay Pacific airline staff in recent days has sparked the imposition of tough new measures.

Chief executive Carrie Lam said health officials now fear the contagious Omicron variant was silently spreading within the community.

"We have cases that have their sources identified but not the route of transmission," she told reporters.

Flights from Australia, Canada, France, India, Pakistan, the Philippines, UK and US will be banned from midnight on Friday for the next two weeks.

"Passenger flights from these countries will not be allowed to land in Hong Kong and individuals who have stayed in those countries are not allowed to board flights to Hong Kong, including transit flights," Lam said.

All large-scale public events would be cancelled while over a dozen types of businesses, including bars, nightclubs, gyms, and beauty parlours, would have to close.

Dining inside restaurants will be banned after 6pm, Lam added, although they can continue to serve takeout.

Hong Kong has bounced between heavy and light restrictions throughout the pandemic including compulsory mask-wearing, limits on more than four people gathering in public and restaurant dining quotas even during periods when no local cases were detected for weeks at a time.