BENGHAZI, Libya — Libya's top leader declared the country officially "liberated" Sunday from the four-decade rule of Moammar Gadhafi, pledging to replace his dictatorship with a more democratic but also a more strictly Islamic system.
In a speech to a cheering, flag-waving crowd, Mustafa Abdul-Jalil, head of the National Transitional Council, promised to ban interest on housing loans and scrap other laws that didn't conform to Islamic jurisprudence.
Although he lacks the power to make such changes himself, his comments, on such a symbolically significant day, suggested that Islam could play a greater role in public life in the new Libya. They also heightened an already intense debate over the role of Islam in the countries transformed by the Arab Spring.
Tens of thousands of Libyans poured into Keish square in Benghazi, the eastern city that was the cradle of the revolution, to celebrate the defeat of Gadhafi in a U.S.-backed eight-month struggle. For a population that had not known freedom of speech or real elections for decades, it marked a dream. Few were bothered by the spectacle hundreds of miles away in the northwestern city of Misrata, where Gadhafi's body was on public display in a frozen-food locker for the third straight day.
"Lift your head, you are a proud Libyan," chanted the crowd in Benghazi, as balloons in the colors of the new flag — red, black and green — floated overhead. Some people waved the flags of France and the United States, both of which were part of an alliance that helped the anti-Gadhafi forces in their struggle.
The government faces daunting challenges, including persuading scores of militias across the country to lay down their weapons and integrate into a new military and justice system.
A first test for the authorities will be putting together a new interim Cabinet to take the country to elections in eight months. Under a time line set by the governing council, the new prime minister and Cabinet are to be in place within 30 days. But some observers say it could take longer as regions that felt neglected by Gadhafi — such as Benghazi — press for more power.
Libyans will vote in June for a 200-member body that will rewrite the constitution, putting the country on track for full elections for a new chief executive and parliament.
Abdul-Jalil, a slight and balding former justice minister, paid homage Sunday to those who lost their lives in the civil war. "This revolution started as peaceful, to demand the minimum. But Gadhafi started killing people with heavy weapons," he said.
In what surprised some in attendance, he gave prominence to the role of Islamic law. "We are an Islamic state," he said, pledging to get rid of regulations that didn't conform to Islamic law.
Among them would be charging interest, he said. "The interest (on loans) will be ruled out. You will not pay it anymore," he said, to thunderous applause from the crowd. The Islamic banking system prohibits charging interest, which is regarded as usury.
But Islamic law encompasses a wide range of approaches to governance, and Libyan officials played down the changes Abdul-Jalil was proposing, saying that he wanted to outlaw interest on housing and personal loans, but not on business loans.
Libya is a conservative Muslim society, in which alcohol is banned and many women wear head scarves. Gadhafi's government tolerated little dissent and often repressed Islamists.
Western officials and human rights groups continued to express concern Sunday about Gadhafi's death in custody. Secretary of State Hillary Rodham Clinton said she would support investigations by the United Nations and the National Transitional Council into the death.
There has been no indication that Libya's governing authorities ordered Gadhafi's execution, but cell phone videos depicting revolutionaries kicking and smacking him have raised questions about whether they were the source of the gunshot to his head. An autopsy concluded Sunday in Misrata confirmed that the shot killed Gadhafi, Libya's chief pathologist, Othman al-Zintani, told the Associated Press.