Hong Kong's economy will shrink 4.1 per cent in the next two years and unemployment will jump to 7 per cent by 2000, according to Morgan Stanley Dean Witter. Its Greater China economist Andy Xie Guoshong has revised his growth forecast for this year from 2 per cent to minus 1.7 per cent after the downturn in the economy. Mr Xie said he did not expect a turnaround until 2001, when prices for assets, labour and services would have adjusted. He said he waited for an indication from the Government of possible tax relief before publishing his revised estimates. 'The Hong Kong Government has indicated in no uncertain terms that it will not cut taxes,' he said. The resulting negative impact on domestic consumption was the main factor in this year's economic contraction. He said Hong Kong would pay the price of a three-year recession for maintaining the dollar peg.