The National Electoral Commission declared Mr Kufuor the winner on Saturday after getting results from all but one of the country's 200 constituencies in the second round of voting.
Thousands of people poured onto the streets to celebrate what is being hailed as a victory for democracy in a country where power has never changed hands by democratic means.
The National Electoral Commission declared Mr Kufuor the winner on Saturday after getting results from all but one of the country's 200 constituencies in the second round of voting.
Mr Kufuor's victory marks the end of a 19-year era in which Ghanaian politics was dominated by charismatic former coup leader Jerry Rawlings, who stood down this year and endorsed the candidacy of Vice-President John Atta Mills.
Wealth creation
Mr Kufuor said his main priority would be to work with the private sector to create the wealth needed to develop the country.
"The outgoing government has paid a lot of lip service to helping the private sector but it never really came round to helping the private sector," he told Reuters news agency in an interview on Saturday.
"On my side, when I say we want to move the private sector forward, to partner it and generate wealth, you'll see it for yourself."
"Everybody has his or her part to play in my administration. There'll be no witch-hunting of individuals or groups," he told a news conference.
He thanked Mr Mills for conceding defeat by telephone on Friday, and also thanked Mr Rawlings, "who at the end of his mandated term has presided over this historic election".
New era
Jerry Rawlings beat Mr Kufuor in 1996 and also won the first presidential election after the return of democratic politics in Ghana in 1992.
He was unable to stand this time because the constitution allows elected presidents a maximum of two four-year terms. He formally steps down on 7 January.
Mr Kufuor won 56.73% of the second round of voting - with 43.27% picked up by Mr Mills.
The president-elect's party also defeated the ruling National Democratic Congress (NDC) in the parliamentary election, which took place at the same time as the first round of presidential voting.