Japanese companies are still looking at China for continued investment opportunities, according to a report by the Japanese Chamber of Commerce and Industry.

The chamber assessed that Japanese companies are still considering China as a viable ground to expand their business despite an apparent decrease of Japanese investment in China.

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The report, released on Wednesday, said that around 54 percent of Japanese companies in China plan to increase investment in the country in the next two years. This ratio is up about 2 percent year-on-year.

In a separate report conducted late last year by the Japan External Trade Organization, 39.6 percent of Japanese companies will maintain current investment levels in China.

According to Yoshihisa Tabata, the chamber's vice chairman, companies that seem to be doing well and hope to "keep the momentum up" belong to the production and selling sectors, like food companies.

However, trade processing industries like fiber and electronics are predicted to reduce operations or explore cheaper markets.

The report also noted the need for equal treatment of local and foreign businesses in China. It called for the development and implementation of a market-oriented company and a loosening of restrictive government regulations.

Chamber Chairman Shinjiro Sawada said that hopefully the report will facilitate "dialogue and cooperation between the Chinese government and Japanese companies."

In late 2013, while production and operational costs were steadily increasing, Japan feared that there was a great risk in putting all of their resources in Beijing, thus resulting in a decline in investment from Japanese businesses.

Nevertheless, Japan is still among the top five investors in China, according to China Daily.

"The outlook for Japanese investment in China depends on the size of the Chinese market and also the competitiveness of Japanese companies," said an economist at the Chinese Academy of Social Sciences' Institute of World Economics and Politics.

"To my knowledge, most Japanese companies are planning to maintain their production in China and are still betting on the huge Chinese market."

Tagsbusiness news, World News, Financial news, Tokyo, Chamber of Commerce and Industry