HIGHLIGHTS: Amendments to AU Founding Charter to be Discussed at Extra-ordinary Summit||Top-level Talks Held on Sidelines of Durban Summit to Try to Resolve Many-sided War in Democratic Republic of Congo|| Amara Essy, OAU Outgoing Secretary General Appointed Interim chairman of AU Commission|| STORY: South Africa took command of Africa's new political union Tuesday, but it was an unexpectedly bumpy launch. Libya's leader Muammar Gaddafi grabbed center stage and confusion reigned about where and when the 53-nation African Union would hold its next summit. (Read photo caption)

At least 40 presidents and monarchs were in the port city of Durban to launch the African Union (AU) with South Africa's President Thabo Mbeki as chairman for its first year.

"Through our actions let us proclaim to the world that this is a continent on the rise," Mbeki told dignitaries and 20,000 spectators in a sports stadium.

After an airforce fly-past, South African musicians, Zulu warriors and dancers celebrated the start of what many hope is the dawn of a new era.

The AU replaces the ineffectual Organization of African Unity (OAU), metaphorically buried Monday aged 39.

However, the new arrival upheld a controversial OAU policy on Madagascar, refusing to recognize millionaire businessman Marc Ravalomanana as president, saying his administration took power unconstitutionally and calling for fresh elections.

Ex-president Didier Ratsiraka, now in Paris, had held power for more than two decades on the giant Indian Ocean island of 16 million people. Ratsiraka fled to France last week after the United States and then France, Germany and China announced they would work with Ravalomanana.

MBEIKI CALLS FOR A SPECIAL SUMMIT

Mbeki called a special or "extraordinary" AU summit to debate radical amendments to the AU's founding charter proposed in Durban by Gaddafi, known at home as "The Guide."

Gaddafi wants Africa to be a single state with one army and believes the serving AU chairman, Mbeki, should move to the body's headquarters in Ethiopia.

South African officials said there was broad support for Mbeki's move to convene an interim meeting on the Libyan amendments and other unfinished business before the AU's next planned summit in Mozambique in 12 months' time.

"That has been sorted out. It will be held within six months," Mbeki's spokesman said.

But a summit communique Tuesday night by the OAU/AU secretariat made no mention of the meeting.

"There has been no decision about an extraordinary summit. The South Africans may be saying that but they are only one country out of 53," one senior secretariat official told Reuters.

Libyan sources said Gaddafi, hoped to host the special summit.

Gaddafi, who took power in a 1969 coup and has bad relations with the United States and most other Western states, has taken a prominent role at the summit.

At their meetings Monday, the heads of state approved the creation of a Peace and Security Council that will have greater powers to tackle conflicts than its predecessor in the OAU.

Top-level talks continued into the early hours Wednesday to try to resolve one of Africa's worst conflicts.

Mbeki, his deputy president Jacob Zuma and U.N. Secretary-General Kofi Annan held a meeting between presidents Joseph Kabila of the Democratic Republic of Congo (DRC) and Paul Kagame of Rwanda to try to end the many-sided war in the DRC.

About two million people have died in the four-year-old conflict, mainly from war-related starvation and disease.

Amara Essy, the outgoing secretary general of the OAU, was appointed interim chairman of the AU commission, but the job will be on the table if there is a special summit, delegates said.

The summit endorsed the New Partnership for Africa's Development, a blueprint to transform the continent's economy and political governance.

PHOTO CAPTION

South African President Thabo Mbeki addresses African leaders and delegates at the launching ceremony of the African Union (AU) in Durban July 9, 2002. At least 40 of the continent's 53 president and monarchs were in the port resort of Durban to see the launch of the African Union (AU) with President Thabo Mbeki as chairman for its first year. (Juda Ngwenya/Reuter