By Hyonhee Shin and Josh Smith

SEOUL, March 10 (Reuters) - South Korean opposition candidate Yoon Suk-yeol was elected president in Wednesday's election, with ruling party candidate Lee Jae-myung conceding defeat and congratulating his opponent.

With more than 95% of the votes counted and Yoon leading, Lee spoke to reporters at Democratic Party headquarters early on Thursday and conceded he had fallen short.

The unusually bitter election campaign was marred by scandals and smears, but the policy stakes are high for the country of 52 million.

Around 77% of South Korea's 44 million eligible voters cast ballots to pick the leader of a nation whose global status is rising even as it has been riven by gender and generational divisions, while facing a confrontational North Korea.

The winner must tackle challenges including South Korea's worst wave of COVID-19 infections, growing inequality and surging home prices, while navigating an increasingly tense rivalry between China and the United States.

Voters also want the new president to root out graft and pursue negotiations to curb North Korea's nuclear ambitions.

An exit poll jointly conducted by KBS and two other major broadcasters had shown Yoon's slight lead with 48.4%, and another one by cable network JTBC put Lee ahead with 48.4% to Yoon's 47.7%.

(Reporting by Hyonhee Shin; Additional reporting by Josh Smith, Daewoung Kim and Yeni Seo; Editing by Robert Birsel, Clarence Fernandez, Mark Heinrich, search engine optimization Alex Richardson and Nick Macfie)