Business

With various trading blocs forming around the globe, South America risks being relegated from the league of world trade. Economies in South America have therefore formed Mercosur as the vehicle towards achieving economic integration. Initially, the membership of Mercosur included Argentina, Paraguay, Uruguay and Brazil. However, the entry of Venezuela as an associate member in 2008 has elicited a lot of controversy. Analysts believe this entry could complicate trade agreements within the block. In line with this statement, this paper explores the potential benefits and drawbacks for the country of Venezuela as a result of its membership in Mercosur. Taking the case of HR Consultancy, this paper examines the potential benefits and drawbacks HR consultants are likely to suffer as a result of Venezuelas membership in Mercosur as well as the adjustments they will need to make as a result of this membership.
 
Introduction
The unity of Latin America continues to generate a lot of debate especially with the entry of Venezuela in Mercosur (Tulchin  Ralph, 2001). While many people support Mercosur as a big stride towards achieving Latin American integration, critics maintain that Mercosur is a very aggressive initiative that is likely to fail if not well monitored (Hinchberger, 1992, p. 1). The major aim of Mercosur is to enhance efficient competition among the member economies in South America. Mercosur also seeks to promote free trading of commodities, services and factors of production as a way of pooling the resources of the member states. However, keen observers are beginning to question the reality of Mercosur as the bridge to economic integration (Tulchin  Ralph, 2002).  Analysts are wondering if Venezuela as a country or its HR consultancy businesses stands to gain from its membership in Mercosur.
Benefits and Drawbacks for Venezuela As A Result Of Their Membership in Mercosur
The first benefit Venezuela stands to reap from Mercosur membership is in the area of international trade ratings. Venezuela stands to benefit from Mercosur since Mercosur enhances free trade within the member states (Lorenzo  Vaillant, 2004). Studies indicate that the total gross domestic product (GDP) of the Mercosur membership is more than one trillion. This implies that the impact of Mercosur as a trading block can powerfully be felt in the world markets. Venezuela stands to benefit greatly from the universal international trade agreement which is likely to boost its rating in international trade (Vilma, 1996).

Mercosur membership is also likely to widen Venezuelas economy. According to Vilma (1996), being a member of Mercosur will enhance Venezuelas accessibility to bigger markets. This is because Mercosur as a trading block has a mission of promoting the free mobility of commodities amongst its membership (World Bank, 2000). This implies that by being integrated into Mercosur, Venezuela is likely to increased its bargaining potential in its oversees trading engagements.

Venezuela also stands to economically and technologically collaborate with other South American economies (Vilma, 1996). As such Venezuela will have the capacity of concentrating on other sectors of the economy. For a long time, the economy of Venezuela has heavily relied on oil. However, with assistance from Mercosur, Venezuela will amass more capital in other industries thereby boosting its GDP and income per capita (Vilma, 1996). This will have the net effect of boosting the buying potential of the Venezuela nationals thus widening the local markets.  

There are two main drawbacks that might come with Venezuelas membership in Mercosur. First, because Venezuela is not a founding member of Mercosur, Venezuela will have to be open to financial stiff competition from countries such as Brazil  (Murinde, 2003, pp. 211-214). This poses a threat to Venezuela whose only competitive industry is oil. This implies that stiff competition from other member states will further weaken smaller industries in Venezuela. Moreover, Venezuela is likely to be controlled by the founding members. With their strong control, the founding members could pass policies such as in the areas of intellectual property and procurements, which might not favor Venezuela (Vilma, 1996). In the long run, these are likely to weaken Venezuelas trade relations with other members of Mercosur.Benefits and Drawbacks for My Business HR Consultancy

Through the promotion of free trade, Venezuela will be open to free trade (Murinde, 2003, pp. 211-214). For a long time, government policies have mainly been geared towards the support of oil industries at the expense of other industries. As way of protecting other industries from stiff competition, the government must bail out non-performing industries through stimulus economic and fiscal packages (Vilma, 1996). Thus, local industries will have to lower their costs in order to boost output if they are to survive in the competitive market.

Through well trained and adequate human capital, businesses in Venezuela will be able to reduce their production expenditure and standardize their operational processes. In their attempt to lower the cost of production, businesses are likely to outsource training for their human capital (Barney  Hesterly, 2008). This implies that Venezuelas membership in Mercosur is likely to create enormous opportunities in strategic management and HR consultancy services. Similarly, Mercosur membership is likely to boost the banking industry thereby enabling businesses to obtain credit at lower costs thus fuelling growth. Similarly, reduced cost of finance is likely to qualify many investment projects which will attract many players into the market leading to rapid economic growth (Lensink  Murinde, 2006, pp. 569-582). As a first entrant, my organization is likely to tap the benefits of first entrants so that when other companies set in, our organization will have established a strong client base, a strong brand as a leading HR consultancy firm and the experience of being an investor among Mercosur member states.  

Mercosur suffers from inadequate intellectual property legislations (Alibaba.com, 2010, p.1). HR consultancy as an industry is heavily reliant on the availability of human capital. According to Lorenzo  Vaillant (2004), since Venezuela will have to promote free trade as a member of Mercosur, other organizations are likely to stumble on resources whose intellectual rights belong to my organization. This implies that with inadequate legislation to safeguard against such, it might be difficult to protect the intellectual property rights of my company. My company is also likely to suffer from unskilled labor since the bulk of my business depends on the availability of qualified manpower.  RHRHhhHHHHHH

Conclusion
In conclusion, several adjustments will need to be made to my business as a result of this membership. On the local front, attempts will be made to bolster other sectors of the economy implying that with time skilled labor will be hard to come by. Thus, as a long term measure, my organization will have a vision of amassing sufficient skilled human capital (Barney  Hesterly, 2008). In this regard, our organization will work hand in hand with educational institutions to achieve this objective. We will also work towards effective patent protection since Mercosur does not have sufficient measures of protecting the same (Alibaba.com, 2010, p.1). Given that other sectors in Venezuela are yet to see massive growth, greater opportunities are likely to exist in other member states. With a robust banking sector, the cost of finance is likely to reduce implying that many HR consultancy practices are likely to be viable. Thus, our company might work in tandem with similar companies in other member states in order to strengthen our presence and growth in the entire Mercosur countries.