GUANGZHOU - The American Chamber of Commerce in South China Thursday said China was the top investment destination for its members, mostly foreign-funded multinational companies.

For 53.3 percent of 215 companies surveyed, China took the top spot in their global investment plans, according to the chamber's annual whitepaper on China's business environment and a special report on the state of business in South China.

Nearly three-quarters have a primary business focus on the Chinese market, while the rest focus on exports.

China remains popular for international investment due to its potential for global market growth, it said.

Roughly 90 percent reported being profitable with most of the rest expecting to make profit within two years. Meanwhile, nearly 70 percent said investment returns in China in 2017 were better than elsewhere.

"Foreign companies are cautiously more optimistic as the central and local governments are giving signals that they will open up the market and welcome more foreign investment," said AmCham South China President Harley Seyedin.

Seyedin applauded China's pledge to treat all businesses registered in China equally.

"We look forward to a more level playing field where we can all profit together," he said.

About 83 percent of participants ranked the business environment in South China as "good" to "very good."

The optimism seems to have affected reinvestment plans. The respondents said their combined budgeted reinvestment for 2018 was expected to rise by 11.8 percent year-on-year to $14 billion in a bid to expand operations and grab larger market shares.

Also, the number of those who intended to transfer their China reinvestments to other markets in 2017 decreased by 24.4 percentage points.

For the first time, Guangzhou, capital of Guangdong province, ranked as the most popular investment destination among 44 cities in China, followed by Shenzhen, Shanghai, and Beijing.

The Guangdong provincial government is more open toward foreign investment, particularly in attracting high-level talents, said the chamber, adding that the government introduced 10 measures in December to expand opening-up and attract foreign direct investment.

Most companies cited "increasing human resource costs,, "shortage of qualified talent," and "fierce local competition" as the top three business challenges in South China. China and the United States can achieve mutual benefits and win win through cooperation, according to the two documents.

Seyedin said businesses from China and the United States needed resources and markets from each other.

"China is transforming its economy into one driven by consumption, services and innovation and many industries in the two countries, particularly the services sector, can complement each other's advantages," he said.

With more than 2,300 members, AmCham South China provides dynamic, on-the-ground support for American and international companies doing business in South China.