ZAGREB - CROATIAN President Stipe Mesic on Friday named the country's first female prime minister-designate, who is to form a new government after the unexpected resignation of Ivo Sanader.

Jadranka Kosor 'gave me valid evidence that she has a necessary majority (in the parliament)... so this evening I am giving her a mandate to form a new government,' Mr Mesic told journalists.

'We will immediately start the important job which is ahead of us,' Ms Kosor said.

The new government is to be presented to the parliament on Monday, she added.

The 56-year-old former journalist, a close ally of Mr Sanader, will be the first woman to occupy the most powerful post in Croatian politics since independence from Yugoslavia in 1991.

Croatia has been in political turmoil since Mr Sanader announced Wednesday he was resigning from the post he had held since 2003 and quitting politics, without providing clear reasons for the move.

The decision sparked criticism from the opposition, observers and a large part of the public in the country facing a serious economic crisis and blocked accession talks with the European Union.

On Friday, the opposition stuck to its previous calls for early elections with the leader of the main opposition Social Democrats, Zoran Milanovic, stressing that Ms Kosor's government would not have 'political legitimacy.'

Among her government's priorities, Ms Kosor cited 'finding new ways out of the (economic) crisis, strengthening the economy, continuing all reforms... notably an extremely strong fight against corruption.' She said a revised budget would be announced by mid-July.

Croatia's economy shrank 6.7 per cent in the past year, first quarter figures showed, the sharpest fall in gross domestic product since 2000. The central bank forecasts that GDP will contract by four per cent in 2009.

'A special and maybe one of the most important tasks of the govnerment in the coming period will be to find a way out of the crisis regarding Croatia's EU accession talks,' Ms Kosor also said after her nomination.

She voiced hope that the issue would be resolved by the end of the year. -- AFP