Zagreb, Jan 12 (IANS): Kolinda Grabar Kitarovic of the opposition Democratic Union is set to become Croatia's first female president with a narrow victory in the country's presidential runoff.

After 97.5 percent of the ballots were counted Sunday, Kitarovic received 50.43 percent, defeating incumbent Ivo Josipovic by a margin of less than one percentage point, Xinhua news agency reported citing the State Electoral Commission.

Josipovic, who gained 49.57 percent of the vote, admitted defeat late Sunday.

"It's a slim margin indeed, but that's the essence of democracy -- the person who wins more votes wins," he told supporters at his election headquarters in Zagreb.

"We had a strenuous campaign, debates and rivalry, but democracy has won. This is a victory in a democratic competition and that's why I congratulate her once again."

Kitarovic, 46, currently serves as NATO's assistant secretary-general for public diplomacy. She was a former Croatian foreign minister and ambassador to the US.

Besides her Democratic Union party, she was supported by eight other parties.

Josipovic, 57, was supported by the ruling Social Democratic Party and 18 other parties.

In the first round of elections Dec 28, Josipovic won 38.46 percent of the vote, while Kitarovic got 37.22 percent.

The Croatian president is elected every five years and can serve no more than two consecutive terms. Josipovic, the third president of the country, took office in 2010.