This study examines aid, state–business relations, and development in Ghana and South Korea. In 1957, when Ghana achieved independence, Ghana and South Korea shared approximately similar levels of GDP per capita. However, while South Korea has successfully transformed itself from a major recipient to a donor country and enjoys advanced economic growth and a high standard of living, Ghana—despite visible growth in recent decades—remains a low-income and aid-dependent country. In this study, focusing on policies that guide state–business relations and their impact on economic development, we examine the extent to which foreign aid played a role in shaping state–business relations and building (or failing to build) public–private development partnerships in South Korea and Ghana. More specifically, we argue that fundamentally in South Korea, through enabling national development policies, state and business worked together to achieve economic development; for Ghana, the local business sector was inadequately integrated as an economic development partner with the state, which explains the less than outstanding performance of various state-led development projects in Ghana in much of the last 50 years. In addition, we argue that in the case of South Korea, aid was used effectively to support and build local business groups, while in Ghana aid has largely failed to boost the private sector, a key factor explaining the divergent paths of aid and development outcomes between the two countries.