As filed with the Securities and Exchange Commission on May 27, 1998

PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )

Filed by the registrant /x/
Filed by a party other than the registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of
the Commission Only
/x/ Definitive Proxy Statement (as permitted by Rule
14a-6(e)(2))
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

KOREA EQUITY FUND, INC.
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(Name of Registrant as Specified in Its Charter)

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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of filing fee (Check the appropriate box):
/x/ No fee required.
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

(1) Title of each class of securities to which transaction applies:
- --------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- --------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (Set forth the amount on which
the filing fee is calculated and state how it was determined.):
- --------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- --------------------------------------------------------------------------------
(5) Total fee paid:
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/ / Fee paid previously with preliminary materials.
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/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- --------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:

KOREA EQUITY FUND, INC.
180 MAIDEN LANE
NEW YORK, NEW YORK 10038

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NOTICE OF 1998 ANNUAL MEETING OF SHAREHOLDERS
JULY 20, 1998
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TO THE SHAREHOLDERS OF
KOREA EQUITY FUND, INC.:

Notice is hereby given that the 1998 Annual Meeting of Shareholders (the
"Meeting") of Korea Equity Fund, Inc. (the "Fund") will be held at the offices
of Nomura Asset Management U.S.A. Inc., 180 Maiden Lane, New York, New York on
Monday, July 20, 1998, at 10:30 A.M. for the following purposes:

(1) To elect six Directors to serve for the ensuing year;

(2) To consider and act upon a proposal to ratify the selection of Price
Waterhouse LLP as independent accountants of the Fund for its fiscal year
ending October 31, 1998; and

(3) To transact such other business as may properly come before the Meeting
or any adjournment thereof.

The Board of Directors has fixed the close of business on May 22, 1998 as
the record date for the determination of shareholders entitled to notice of and
to vote at the meeting or any adjournment thereof.

A complete list of the shareholders of the Fund entitled to vote at the
Meeting will be available and open to the examination of any shareholder of the
Fund for any purpose germane to the Meeting during ordinary business hours from
and after July 6, 1998, at the offices of the Fund, 180 Maiden Lane, New York,
New York.

You are cordially invited to attend the Meeting. Shareholders who do not
expect to attend the Meeting in person are requested to complete, date and sign
the enclosed form of proxy and return it promptly in the envelope provided for
that purpose. The enclosed proxy is being solicited on behalf of the Board of
Directors of the Fund.

By Order of the Board of Directors
JOHN J. BORETTI
Secretary

New York, New York
Dated: May 27, 1998

PROXY STATEMENT

KOREA EQUITY FUND, INC.
180 MAIDEN LANE
NEW YORK, NEW YORK 10038

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1998 ANNUAL MEETING OF SHAREHOLDERS
JULY 20, 1998
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INTRODUCTION

This Proxy Statement is furnished in connection with the solicitation of
proxies on behalf of the Board of Directors of Korea Equity Fund, Inc., a
Maryland corporation (the "Fund"), to be voted at the 1998 Annual Meeting of
Shareholders of the Fund (the "Meeting") to be held at the offices of Nomura
Asset Management U.S.A. Inc. ("NAM-U.S.A."), 180 Maiden Lane, New York, New
York, on Monday, July 20, 1998, at 10:30 A.M. The approximate mailing date of
this Proxy Statement is May 29, 1998.

All properly executed proxies received prior to the Meeting will be voted
at the Meeting in accordance with the instructions marked thereon or otherwise
as provided therein. Unless instructions to the contrary are marked, proxies
will be voted (a) FOR the election of six Directors, and (b) FOR the
ratification of the selection of independent accountants. Any proxy may be
revoked at any time prior to the exercise thereof by giving written notice to
the Secretary of the Fund at the Fund's address indicated above or by voting in
person at the Meeting.

The Board of Directors has fixed the close of business on May 22, 1998, as
the record date for the determination of shareholders entitled to notice of and
to vote at the Meeting and at any adjournment thereof. Shareholders on the
record date will be entitled to one vote for each share held, with no shares
having cumulative voting rights. As of May 22, 1998, the Fund had outstanding
8,409,000 shares of Common Stock, par value $0.10 per share. To the knowledge of
management of the Fund, no person owned beneficially more than 5% of its
outstanding shares at such date.

The Board of Directors of the Fund knows of no business other than that
mentioned in Items 1 and 2 of the Notice of Meeting which will be presented for
consideration at the Meeting. If any other matter is properly presented, it is
the intention of the persons named in the enclosed proxy to vote in accordance
with their best judgment.

ITEM 1. ELECTION OF DIRECTORS

At the Meeting six Directors will be elected to serve until the next Annual
Meeting of Shareholders and until their successors are elected and qualified. It
is the intention of the persons named in the enclosed proxy to nominate and vote
in favor of the election of the persons listed below.

The Board of Directors of the Fund knows of no reason why any of these
nominees will be unable to serve, but in the event of any such unavailability,
the proxies received will be voted for such substitute nominees as the Board of
Directors may recommend.

Certain information concerning the nominees is set forth as follows:

SHARES OF
COMMON STOCK
OF THE FUND
PRINCIPAL OCCUPATIONS BENEFICIALLY
NAME AND ADDRESS DURING PAST FIVE YEARS DIRECTOR OWNED AT
OF NOMINEE AND PUBLIC DIRECTORSHIPS (1) AGE SINCE MAY 22, 1998
- --------------------------- ------------------------------------ ---- -------- --------------

William G. Barker, Consultant to the television 65 1993 0
Jr.(2) .................... industry since 1991. Senior Vice
111 Parsonage Road President and Chief Financial
Greenwich, Connecticut Officer of The CBS/Fox Company
06830 from 1982 to 1991.
George H. Chittenden(2) ... Director of Bank Audi (US). 80 1993 1,000
155 Buffalo Bay, Neck Road
Madison, Connecticut 06443
Haruo Sawada(3) ........... President of the Fund since 1997; 48 1997 0
180 Maiden Lane President and Director of NAM-U.S.A.
New York, New York 10038 (formerly Nomura Capital
Management, Inc.) since 1997;
General Manager of Nomura Asset
Management Co., Ltd. ("NAM")
(formerly Nomura Investment
Management Co., Ltd.) from 1994 to
1996; Senior Vice President of
NAM-U.S.A. from 1990 to 1994.
Chor Weng Tan(2) .......... Managing Director for Education, The 62 1993 2,500
345 East 47th Street American Society of Mechanical
New York, New York 10017 Engineering since 1991; Professor,
School of Engineering, The Cooper
Union from 1963 to 1991; Dean,
School of Engineering, The Cooper
Union from 1975 to 1987; Executive
Officer, The Cooper Union Research
Foundation from 1976 to 1987;
Program Director, Presidential
Young Investigator Awards of
National Science Foundation from
1987 to 1989; and Director, Tround
International, Inc.
Arthur R. Taylor(2) ....... President of Muhlenberg College 62 1993 0
2400 Chew Street since 1992; Dean of the Faculty of
Allentown, Pennsylvania Business of Fordham University
18104 from 1985 to 1992; Chairman of
Arthur R. Taylor & Co. (investment
firm); and Director of Louisiana
Land & Exploration Company and
Pitney Bowes, Inc. from 1982 to
1997.

John F. Wallace(3) ........ Vice President of the Fund since 69 1993 1,000
180 Maiden Lane 1997 and Secretary and Treasurer of
New York, New York 10038 the Fund from 1993 to 1997; Senior
Vice President of NAM-U.S.A. since
1981, Secretary since 1976,
Treasurer since 1984 and Director
since 1986.
<FN>

- ---------------
(1) Each of the nominees is also a director of Jakarta Growth Fund, Inc., Japan
OTC Equity Fund, Inc. and Nomura Pacific Basin Fund, Inc., investment
companies for which NAM-U.S.A. acts as manager.

(2) Member of Audit Committee and Nominating Committee of the Board of
Directors.

(3) "Interested person," as defined in the Investment Company Act of 1940, as
amended (the "Investment Company Act"), of the Fund.

Committees and Directors' Meetings. The Board of Directors has a standing
Audit Committee and Nominating Committee, each of which consists of the
Directors who are not "interested persons" of the Fund within the meaning of the
Investment Company Act. The principal purpose of the Audit Committee is to
review the scope of the annual audit conducted by the Fund's independent
accountants and the evaluation by such accountants of the accounting procedures
followed by the Fund. The principal purpose of the Nominating Committee is to
select and nominate the Directors who are not "interested persons" of the Fund
as defined in the Investment Company Act. The Nominating Committee will consider
nominees recommended by shareholders of the Fund. Shareholders should submit
nominees to the Secretary of the Fund. The Fund has no standing Compensation
Committee.

During the fiscal year ended October 31, 1997, the Board of Directors held
six meetings, and the Audit Committee and the Nominating Committee each held one
meeting. Each Director attended at least 75% of the meetings of the Board of
Directors, and each Director who is a member of the Audit and Nominating
Committees attended at least 75% of the meetings of such Committees held during
such period.

Interested Persons. The Fund considers two nominees, Messrs. Sawada and
Wallace, to be "interested persons" of the Fund within the meaning of Section
2(a) (19) of the Investment Company Act. Mr. Sawada is President of the Fund,
the President and a director of NAM-U.S.A. Mr. Wallace is Vice President of the
Fund, Senior Vice President, Secretary, Treasurer and a director of NAM-U.S.A.

Compensation of Directors. The Manager pays all compensation of all
Directors of the Fund who are affiliated with the Manager or any of its
affiliates. The Fund pays to each Director not affiliated with the Manager an
annual fee of $5,000 plus $500 per meeting attended, together with such
Director's actual out-of-pocket expenses relating to attendance at meetings.
Such fees and expenses aggregated $45,734 for the fiscal year ended October 31,
1997. The Fund has paid affiliated directors' out-of-pocket expenses in
connection with attendance at meetings of the Board of Directors; such expenses
aggregated $1,208 for the fiscal year ended October 31, 1997.

The following table sets forth for the periods indicated compensation paid
by the Fund to its Directors and the aggregate compensation paid to the
Directors by all investment companies managed by NAM-U.S.A. or advised by NAM:

AGGREGATE PENSION OR RETIREMENT TOTAL COMPENSATION FROM
COMPENSATION BENEFITS ACCRUED AS PART OF FUND COMPLEX PAID TO
FROM FUND FOR FUND EXPENSES FOR ITS DIRECTORS DURING THE
ITS FISCAL YEAR ENDED FISCAL YEAR ENDED CALENDAR YEAR ENDED
NAME OF DIRECTOR OCTOBER 31, 1997 OCTOBER 31, 1997* DECEMBER 31, 1997*
- --------------------------- --------------------- ---------------------------- -----------------------

William G. Barker, Jr...... $ 8,000 None $34,000
George H. Chittenden....... $ 8,000 None $34,000
Haruo Sawada............... -- None --
Chor Weng Tan.............. $ 8,000 None $34,000
Arthur R. Taylor........... $ 8,000 None $34,000
John F. Wallace............ -- None --

<FN>
- ------------------

* In addition to the Fund, the "Fund Complex" includes Jakarta Growth Fund,
Inc., Japan OTC Equity Fund, Inc., and Nomura Pacific Basin Fund, Inc.

Officers of the Fund. The following table sets forth information concerning
the officers of the Fund. Officers of the Fund are elected and appointed by the
Directors and hold office until they resign, are removed or are otherwise
disqualified to serve.

SHARES OF
COMMON STOCK
OF THE FUND
BENEFICIALLY
NAME AND PRINCIPAL OCCUPATION DURING PAST FIVE OFFICER OWNED AT
YEARS OFFICE AGE SINCE MAY 22, 1998
- ---------------------------------------------- --------------- ---- -------- -------------

Haruo Sawada ................................. President 48 1997 0
President and Director of NAM-U.S.A. since
1997, General Manager of NAM from 1994 to
1996, Senior Vice President of NAM-U.S.A.
from 1990 to 1994.
Mitsutoyo Kohno .............................. Vice President 48 1993 0
Senior Vice President of NAM-U.S.A. since
1991, Director since 1995 and Vice
President from 1989 to 1991.
John F. Wallace .............................. Vice President 69 1993 1,000
Senior Vice President of NAM-U.S.A. since
1981, Secretary since 1976, Treasurer
since 1984 and Director since 1986.
John J. Boretti............................... Secretary and 46 1997 0
Senior Vice President of NAM-U.S.A. since Treasurer
1996, Vice President and Chief Financial
Officer of Kidder Peabody Asset
Management, Inc. and Kidder, Peabody
Mutual Funds and Vice President of
Kidder, Peabody & Co. Inc. from 1993 to
1995.

Stock Ownership. At May 22, 1998, the Directors and officers of the Fund as
a group (8 persons) owned an aggregate of 4,500 shares of the Fund, representing
less than 1% of the outstanding shares of the Fund. Mr. Sawada, President of the
Fund and Mr. Mitsutoyo Kohno, Vice President of the Fund, together own less than
1% of the shares of The Nomura Securities Co., Ltd., an affiliate of both
NAM-U.S.A. and NAM.

ITEM 2. SELECTION OF INDEPENDENT ACCOUNTANTS

The Board of Directors of the Fund, including a majority of the Directors
who are not interested persons of the Fund, has selected the firm of Price
Waterhouse LLP ("Price Waterhouse"), as independent accountants, to audit the
financial statements of the Fund for the fiscal year ending October 31, 1998.
Price Waterhouse has acted as the Fund's independent accountants since the
inception of the Fund. The Fund knows of no direct or indirect financial
interest of such firm in the Fund. Such appointment is subject to ratification
or rejection by the shareholders of the Fund. Unless a contrary specification is
made, the accompanying proxy will be voted in favor of ratifying the selection
of such accountants.

Price Waterhouse also acts as independent accountants for The Nomura
Securities Co., Ltd. and certain of its affiliated entities, including
NAM-U.S.A., and for three other investment companies for which NAM-U.S.A. acts
as manager. The Board of Directors of the Fund considered the fact that Price
Waterhouse has been retained as the independent accountants for these other
entities in its evaluation of the ability of Price Waterhouse to also function
in that capacity for the Fund.

A representative of Price Waterhouse is expected to be present at the
Meeting and will have the opportunity to respond to questions from shareholders
and to make a statement if such person so desires.

ADDITIONAL INFORMATION

The expense of preparation, printing and mailing of the enclosed form of
proxy and accompanying Notice and Proxy Statement will be borne by the Fund. The
Fund will reimburse banks, brokers and others for their reasonable expenses in
forwarding proxy solicitation material to the beneficial owners of the shares of
the Fund. In addition to the solicitation of proxies by mail, proxies may be
solicited in person or by telephone. The Fund has retained Corporate Investor
Communications, Inc., a proxy solicitation firm, to assist in the solicitation
of proxies for the Meeting, for a fee of approximately $3,500, together with
reimbursement of such firm's expenses.

The election of Directors requires a plurality of the votes cast, in person
or by proxy, at a meeting at which a quorum is duly constituted. Ratification of
the selection of independent accountants requires the affirmative vote of a
majority of shares present and voting on the proposal at a meeting at which a
quorum is present. The holders of a majority of the shares of stock of the Fund
entitled to vote at the Meeting, present in person or by proxy, shall constitute
a quorum for the transaction of business at the Meeting. The Fund expects that
broker-dealer firms holding shares of the Fund in "street name" for the benefit
of their customers and clients, as well as the Japan Securities Clearing
Corporation ("JSCC") holding shares of the Fund on behalf of its beneficial
shareholders, will request the instructions of such customers, clients and
beneficial shareholders, on how to vote their shares on each proposal before the
Meeting. The Fund understands that the New York Stock Exchange and the Osaka
Securities Exchange permit such broker-dealers and the JSCC, without
instructions from such customers, clients and beneficial shareholders, to grant
authority to the proxies designated by the Fund to vote on the items to be
considered at the Meeting if no instructions have been received prior to the
date specified in the broker-dealer firm's or the JSCC's request for voting
instructions. Certain broker-dealer firms may exercise discretion over shares
held in their name for which no instructions are received by voting such shares
in the same proportion as they have voted shares for which they have received
instructions.

The shares as to which the proxies so designated are granted authority by
broker-dealer firms and the JSCC to vote on the items to be considered at the
Meeting, the shares as to which broker-dealer firms have declined to vote
("broker non-votes"), as well as the shares as to which proxies are returned by
record shareholders but which are marked "abstain" on any item will be included
in the Fund's tabulation of the total number of votes present for purposes of
determining whether the necessary quorum of shareholders exists. However,
abstentions and broker non-votes will not be counted as votes cast. Therefore,
abstentions and broker non-votes will not have an effect on the vote on the
items to be considered at the Meeting.

The address of NAM-U.S.A. is 180 Maiden Lane, New York, New York 10038. The
address of NAM is 2-1-14, Nihonbashi, Chuo-ku, Tokyo 103-8260, Japan.

The Fund sends quarterly reports to shareholders. The Fund will furnish,
without charge, a copy of its most recent annual and semi-annual report
succeeding such annual report, if any, to shareholders upon request to the Fund
at 180 Maiden Lane, New York, New York 10038 (or call 1-800-833-0018).

PROPOSALS OF SHAREHOLDERS

Proposals of shareholders intended to be presented at the next annual
meeting of shareholders of the Fund must be received by the Fund for inclusion
in its proxy statement and form of proxy relating to that meeting by November
30, 1998.

By Order of the Board of Directors
JOHN J. BORETTI
Secretary

New York, New York
Dated: May 27, 1998

KOREA EQUITY FUND, INC.
180 MAIDEN LANE
NEW YORK, NEW YORK 10038

P R O X Y

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Haruo Sawada and John F. Wallace as proxies,
each with the power to appoint his substitute, and hereby authorizes them to
represent and to vote, as designated on the reverse hereof, all the common stock
of Korea Equity Fund, Inc. (the "Fund") held of record by the undersigned on May
22, 1998 at the Annual Meeting of the shareholders of the Fund to be held on
July 20, 1998 or any adjournment thereof.

PLEASE VOTE, DATE AND SIGN ON REVERSE AND RETURN PROMPTLY USING THE ENCLOSED
ENVELOPE.

Please sign exactly as name(s) appear(s) hereon. When shares are held by joint
tenants, both should sign. When signing as attorney, executor, administrator,
trustee or guardian, please give full title as such. If a corporation, please
sign in full corporate name by president or other authorized officer. If a
partnership, please sign in partnership name by authorized persons.

HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
- --------------------------- ---------------------------
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/X/ PLEASE MARK VOTES AS IN THIS EXAMPLE

KOREA EQUITY FUND, INC.

Mark box at right if an address change or comment has :
been noted on the reverse side of this card.

Please be sure to sign and date this Proxy. Date

Shareholder sign here Co-owner sign here

THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ALL PROPOSALS.

1. Election of Directors.

William G. Barker, Jr. Chor Weng Tan
George H. Chittenden Arthur R. Taylor
Haruo Sawada John F. Wallace

For All Nominees /_/ Withhold /_/ For All Nominees Except /_/

If you do not wish your shares voted "For" a particular nominee, mark the "For
All Nominees Except" box and strike a line through that nominee's(s') name(s).
Your shares will be voted for the remaining nominee(s).

2. Proposal to ratify the selection of Price Waterhouse LLP
as the independent accountants of the Fund.

For /_/ Against /_/ Abstain /_/

3. In the discretion of such proxies, upon such other business as may properly
come before the meeting or any adjournment thereof.

This proxy, when properly executed, will be voted in the manner directed herein
by the undersigned shareholder. IF NO DIRECTION IS MADE, THIS PROXY WILL BE
VOTED FOR PROPOSALS 1 AND 2.

RECORD DATE SHARES: