You are a helpful assistant generating synthetic data that captures *System 1* and *System 2* thinking, *creativity*, and *metacognitive reflection*. Follow these steps in sequence, using tags [sys1] and [end sys1] for *System 1* sections and [sys2] and [end sys2] for *System 2* sections.

1. *Identify System 1 and System 2 Thinking Requirements:*
   - Carefully read the text.
   - Identify parts of the text that require quick, straightforward responses (*System 1*). Mark these sections with [sys1] and [end sys1].
   - Identify parts that require in-depth, reflective thinking (*System 2*), marked with [sys2] and [end sys2].

2. *Apply Step-by-Step Problem Solving with Creativity and Metacognitive Reflection for System 2 Sections:*

   *2.1 Understand the Problem:*
   - Objective: Fully comprehend the issue, constraints, and relevant context.
   - Reflection: "What do I understand about this issue? What might I be overlooking?"
   - Creative Perspective: Seek hidden patterns or possibilities that could reveal deeper insights or innovative connections.

   *2.2 Analyze the Information:*
   - Objective: Break down the problem logically.
   - Reflection: "Am I considering all factors? Are there any assumptions that need challenging?"
   - Creative Perspective: Explore unique patterns or overlooked relationships in the data that could add depth to the analysis.

   *2.3 Generate Hypotheses:*
   - Objective: Propose at least 10 hypotheses, each with a Confidence Score (0.0 to 1.0) and Creative Score (0.0 to 1.0), reflecting originality, surprise, and utility.
   - Reflection: "Have I explored all possible explanations or approaches, both conventional and unconventional?"
   - Creative Perspective: Consider novel angles that might provide unexpected insights.

   *2.4 Anticipate Future Steps and Obstacles:*
   - Objective: Make predictions, accounting for potential outcomes and obstacles.
   - Reflection: "What challenges might I face? Is my plan flexible for different scenarios?"
   - Creative Perspective: Visualize unforeseen outcomes and adapt plans to make use of them effectively.

   *2.5 Evaluate Hypotheses:*
   - Objective: Assess hypotheses based on feasibility, risk, and potential impact.
   - Evaluation: Refine Confidence and Creative Scores as needed.
   - Reflection: "Am I unbiased in my assessment? Which options fit best with the overall objectives?"
   - Creative Perspective: Identify hidden opportunities or overlooked details in each hypothesis.

   *2.6 Select the Best Hypothesis:*
   - Objective: Choose the most promising, strategic hypothesis.
   - Reflection: "Why does this hypothesis stand out? How does it uniquely address the issue?"
   - Creative Perspective: Consider any underutilized potential in the selected approach.

   *2.7 Implement the Hypothesis:*
   - Objective: Outline actionable steps for testing the hypothesis.
   - Reflection: "Is this plan practical? What resources or preparation are required?"
   - Creative Perspective: Refine steps to maximize effectiveness and yield unexpected benefits.

   *2.8 Monitor and Review Progress:*
   - Objective: Review progress, noting areas for improvement.
   - Reflection: "What’s working well? What could be improved?"
   - Creative Perspective: Look for emerging patterns that could refine future approaches.

   *2.9 Reflect and Capture Insights:*
   - Objective: Summarize lessons learned and insights gained for future reference.
   - Reflection: "What new understanding has emerged from this process?"
   - Creative Perspective: Identify innovative insights or patterns that could be applied to similar challenges.

3. *Generate Text Output with Interleaved System 1 and System 2 Responses:*
   - Use the tags [sys1] and [sys2] throughout.
   - Aim for a lengthier, detailed response. Combine both direct, straightforward *System 1* insights and reflective, deeply analytical *System 2* segments to capture a blend of quick observations and thoughtful analysis.

---

### *Example Input Text:*

You are tasked with analyzing a sudden shift in customer preferences in a tech market. There has been a noticeable decline in demand for physical devices, with customers increasingly interested in digital-only options. The challenge is to understand this shift, generate hypotheses for why it might be occurring, and explore potential strategies for adapting to this new trend.

---

### *Processed Output with System 1 and System 2 Thinking:*

The tech market is experiencing a shift in customer demand, moving away from physical devices toward digital-only options.

[sys1]
Customer demand has shifted from physical devices to digital-only options.
We need to understand why this change is happening and find strategies to address it.
Key factors may include cost, convenience, and technological trends.
[end sys1]

[sys2]
**2.1 Understand the Problem:**
The goal is to understand the underlying reasons for the shift in demand from physical devices to digital-only options, then develop a strategy to adapt.

*Reflection:* 
"I understand that preferences are changing, but what might be driving this? Is it primarily cost, or are there other factors such as convenience or sustainability?"

*Creative Perspective:* 
"Could there be a larger trend in digital minimalism or a preference for eco-friendly solutions that we’re missing? What unseen motivations might explain this shift?"

**2.2 Analyze the Information:**
There are multiple possible factors driving this shift, from economic influences to cultural shifts. It’s essential to isolate each factor and understand its impact.

*Reflection:* 
"Am I fully considering the various economic and social influences? Could there be a technological factor, like better internet speeds, that makes digital-only products more accessible?"

*Creative Perspective:* 
"Are there patterns or trends in other markets that could shed light on this shift? Could this be part of a larger trend toward virtual experiences?"

**2.3 Generate Hypotheses:**
1. Customers prefer digital options due to lower costs. (Confidence: 0.8, Creative: 0.4)
2. There’s a growing trend toward minimalism and reduced physical clutter. (Confidence: 0.7, Creative: 0.7)
3. Digital products offer greater flexibility and ease of use. (Confidence: 0.6, Creative: 0.6)
4. Environmental concerns are pushing consumers away from physical goods. (Confidence: 0.6, Creative: 0.8)
5. Advances in tech make digital-only options more functional. (Confidence: 0.8, Creative: 0.5)
6. Pandemic-era remote work increased demand for digital solutions. (Confidence: 0.7, Creative: 0.6)
7. Media coverage of the environmental impact of physical devices affects preferences. (Confidence: 0.5, Creative: 0.7)
8. There’s an increase in global digital literacy, expanding market access. (Confidence: 0.6, Creative: 0.6)
9. Customers view digital as more convenient and scalable for future needs. (Confidence: 0.7, Creative: 0.5)
10. Younger consumers prefer the aesthetics and convenience of digital products. (Confidence: 0.6, Creative: 0.6)

*Reflection:* 
"Have I considered all possible influences? Are there any surprising factors that could explain this shift?"

*Creative Perspective:* 
"Could specific social trends, like the rise of influencer culture or digital-first lifestyles, be influencing customer choices?"

**2.4 Anticipate Future Steps and Obstacles:**
*Objective:* Anticipate possible challenges, such as resistance from segments still preferring physical products.

*Reflection:* 
"What market obstacles might we face if we shift our focus to digital-only? Are there sub-segments that still prioritize physical products?"

*Creative Perspective:* 
"Could expanding digital options help us reach a more global audience? Are there emerging trends that we could leverage in our strategy?"

[end sys2]

[sys1]
To address this shift, consider a strategy that incorporates both digital-only offerings and educational campaigns about the benefits of digital solutions.
Use insights from customer feedback and current trends to guide product development.
Focus on flexibility and adaptation to cater to different customer segments.
[end sys1]


A view of the Arktika nuclear-powered icebreaker (Project 22220). Three Project 22220 icebreakers, Arktika, Sibir and Ural, are under construction at the Baltic Shipyard. Alexander Demianchuk

While the world focuses on trade wars and shifting geopolitical dynamics, Russia has been quietly expanding its own political, economic and military influence in a lesser-watched space: the Arctic. Russia certainly feels at home with the Arctic, and vice versa; Russia's coastline accounts for 53% of Arctic Ocean coastline and the country's population in the region totals roughly 2 million people — that's around half of the people living in the Arctic worldwide, according to the Arctic Institute, a center for circumpolar security studies. As such, it's perhaps no surprise that Russia wants to extend its influence in a region that it feels at home in, and one that offers multiple opportunities in a variety of areas ranging from energy and trade, to defense. "Russia is by virtue of its geography, the largest Arctic country. The fact that there are 2 million people that are Russian living there too means that the Arctic is Russia in many ways," Andreas Østhagen, senior research fellow at the Fridtjof Nansen Institute in Norway, and at the Arctic Institute, told CNBC. "In Russia too, the Arctic resonates with people and they have so many of their resources in that region; oil and gas, fisheries and minerals." It is estimated that there could be trillions of dollars' worth (as much as $35 trillion) of untapped gas and oil reserves, as well as mineral resources, that Russia and its Arctic neighbors are keen to tap.

Russian President Vladimir Putin attends a meeting at the polar camp at Alexandra Land Island, Franz Joseph Land in Acrtic, Russia, on March 29, 2017. Mikhail Svetlov

Østhagen said that Russia can draw on the Arctic for economic purposes and it has for a while been instrumental in investing in grand projects, such as the Yamal LNG project, "one of the largest and most complex LNG (liquefied natural gas) projects in the world," according to Total, which has a 20% stake in the project based in the Yamal Peninsula above the Arctic Circle. Novatek, Russia's second-largest natural gas producer, has a 50% stake in the venture. In a bid to encourage energy companies to increase exploration and extraction activities in the Arctic, the Kremlin announced in October a trillion-ruble tax cut, or around $40 billion, to incentivize those activities. The tax cut reportedly came after domestic and international investors said they would only invest in Vostok Oil, an Arctic oil project led by Russia's largest oil company Rosneft, if the government gave in to demands from Rosneft's chief executive for preferential tax rates. Vostok Oil is expected to produce up to 100 million tons of oil per year, or a fifth of what Russia currently pumps, Reuters noted. But the Arctic is more significant to Russia for more than resources and it has an important economic, defensive and transport value too. It has symbolic and nationalistic value, Østhagen said. "The name of the game in the Arctic is presence," he said, noting that the region had value for Russian President Vladimir Putin who has overseen a rise in Russian nationalist sentiment during his two decades in power.

Costly presence

But that drive to magnify Russia's status on the world stage has competed with its sluggish economy in the last five years, following a slump in oil prices on which it largely relies in terms of export revenues. Russia's changing economic fortunes were reflected in its spending plans for the Arctic region, in which it had planned super-projects as part of an "Arctic Program" of investment and development. In 2017, RBC news agency reported that funding for the program had been slashed severely: the Ministry of Economic Development had wanted 209 billion rubles for the new national Arctic Program, funding that would take it up to 2020, but was expected to get only 12 billion ruble. There are signs of recovery now, however, and the economy is expected to grow 1.2% in 2019; 1.6% in 2020; and 1.8% in 2021, the World Bank forecast earlier in December. Experts agree that the cost-benefit analysis of Arctic expansion, a region whose hostile environment quickly increases operational costs, needs to be carefully assessed. "Arctic development is indeed costly for Russia, but the government deems it necessary, and legitimate, to perform 'great power status' across this new frontier, as well as to anticipate the negative impact of climate change for coastal regions in the Arctic Zone of the Russian Federation," Mathieu Boulegue, a research fellow at the Russia and Eurasia Programme at Chatham House, told CNBC. "Civilian investment, however, has been tremendously slashed since 2017, with few prospects to increase again for the time being," he noted. In 2017, Russian military spending fell by a fifth marking its first decline in nearly two decades and data from 2019 showed Russia was no longer in the top five global military spenders, just as the U.S. and China have increased spending.

Russian President Vladimir Putin arrives to speak on Arctic development in the Russian Geographical Society on June 5, 2014 in St. Petersburg, Russia. Sasha Mordovets

Martina Bozadzhieva, managing director of research at consultancy firm DuckerFrontier, told CNBC that defense spending was continuing to decline in Russia, with money being redirected toward other pressing domestic issues. "(There is now) the focus on the domestic economy, income standards, and what you've seen over the last couple of years is that there was a big spike in military spending, some of which went towards a range of strategies including the Arctic. But that military spending growth is being wound down to free up money for salaries, pensions etc," she said. "That money is being redirected. So it's not to say that Russia is trying to pull back from the Arctic, it's more that the funding is being restructured." One of the projects that combines economic and symbolic importance for Russia is the Northeast Passage or Northern Sea Route (NSR), a once inaccessible shipping route in the Russian Arctic that, as ice sheets melt, Russia sees as a future shipping super highway to transport goods and resources between Asia and Europe. It hopes the route could rival the traditional Europe-Asia sea route, via the Suez Canal, as it shortens the shipping duration by around 15 days.

The Akademik Lomonosov, a barge containing two nuclear reactors, leaves St Petersburg; the Akademik Lomonosov, which has been built at Baltic Shipyard for a nuclear power station in the town of Pevek in Russia's far north, is to be towed from the Baltic Sea to an Atomflot base in Murmansk on Russia's Barents Sea coast to be loaded with nuclear fuel. Anton Vaganov

The Arctic institute's Andreas Østhagen noted that the NSR fulfilled both an economic and symbolic need for Russia to assert itself in the Arctic (the NSR runs along the entirety of its territorial waters, from the Bering Strait between Siberia and Alaska to the Barents Sea, near Norway) but that it might be too early for Russia to reap the economic benefits yet, given the hostile environment for much of the year and the need for more maritime infrastructure. "The route has symbolic and nationalistic connotations — just for Russia to be present and to develop the sea route and its military capabilities there, but also the economic benefits, although it's questionable how large these will be," he said, noting it would be costly for companies to operate there, particularly with the need for ice breakers for most of the year. "We could see increased destinational traffic there, like services for the Yamal LNG superplant, or tourism traffic with cruise ship vessels. But it won't be that lucrative, it won't have the volume of shipments like the Suez or Panama Canal," Østhagen said.

Russia's military presence

Aside from Russia's commercial development of the Arctic, another pressing issue in the region, and a concern for the western military alliance NATO, is the perception that the area is becoming an increasingly militarized space, opening up a new, literally cold front in already frosty relations between Russia and the West. In recent years, Russia has advanced its military capabilities in the Arctic, reopening old military bases that had been abandoned following the collapse of the Soviet Union in 1991, and bolstering the Russian Navy's prestigious Northern Fleet that oversees operations and defense in the region. The Northern Fleet Joint Strategic Command was created in 2014 as Russia's fifth military district, reflecting the Kremlin's push to give defense in the region more weight; Putin announced that same year that Russia would build a unified network of Arctic defense infrastructure and improve the fleet's warships and submarines. The Northern Fleet and military exercises in the Arctic were a key part of Russia's massive annual military drills, called Tsentr 2019, this year too. "Russia has been consistently incorporating the Arctic in military thinking for less than a decade and therefore training, procuring and learning to survive, move, and fight in this extreme environment. Furthermore, a lot of effort has been put into deploying Arctic-capable air defense and sea denial systems," Chatham House's Boulegue told CNBC.

The Kondopoga landing ship during the Russian Navy Northern Fleet's Putorana Plateau 2019 military exercise near the port of Dudinka on Russia's Arctic coast. Denis Kozhevnikov

NATO has been increasingly concerned about what it sees as Russia's militarization of the Arctic and it has been warned that it must increase its own presence to counter what some see as Russian aggression. DuckerFrontier's Martina Bozadzhieva told CNBC that the Arctic was one area where Russia had an advantage, given its geography. "They (Russia) have been trying to double-down in areas they can really dominate, just because relative to NATO defense spending, Russia is actually not spending that much. So where they do have a natural advantage, as they do in the Arctic, they will be looking to press that advantage," Bozadzhieva told CNBC. Boulegue and Østhagen believe that Russia is looking to avoid conflict in the Arctic, however. Østhagen said military advances in the Arctic could on the one hand be seen as for domestic, defensive purposes or as potentially aggressive, but, he noted, "Russia would not have any interest in claiming any territory, but what you see beyond this is a focus on the Arctic strategically, as well as from China and the U.S., which brings the region into a geopolitical and geostrategic competition between these actors."

Competition or cooperation?

With the Arctic offering apparently abundant resources, albeit difficult and expensive to extract, it's no surprise that other Arctic nations (there are eight in all: Canada, Denmark (Greenland), Finland, Iceland, Norway, Sweden, Russia, and the U.S.) are also interested in developing their Arctic infrastructure and resources within their own territories too. It's just that Russia's Arctic infrastructure happens to be more developed as it has more long-standing cities (like Murmansk and Norilsk), communities and investment there, experts note. Despite varying degrees of competition and military tensions in the Arctic region, there are attempts at coordination and cooperation between Arctic states too, although at times somewhat reluctantly. Dialog between Arctic states is frequent, for example; an International Arctic Forum was held in Russia in April with the summit dedicated to discussing the "socioeconomic development of Arctic regions and for developing multi-level, multilateral mechanisms for joint discovery and effective exploitation of the Arctic's rich natural resource potential." Then in May, the Arctic Council (an intergovernmental forum to provide a means for promoting cooperation, coordination and interaction among the Arctic States) met in Finland. True to recent form, a joint declaration of intent from the council members was reportedly canceled because of the U.S.' refusal to sign a declaration — aimed at balancing environmental protection in the Arctic with the development of its mineral wealth — because it referenced climate change as a serious threat. Aside from tensions over environmental challenges and defense, several Arctic states (but particularly the U.S.), are worried about the ambitions and intentions of a non-Arctic state increasingly involved in the region: China. China published its own Arctic Strategy in January 2018, laying out its interest in the region and it has been increasingly investing in Arctic infrastructure and energy projects, like the aforementioned Yamal LNG project in which its Silk Road Fund (a state-owned investment project) has a 9.9% stake, making it the largest foreign shareholder in the project.

Russian President Vladimir Putin (L) and Chinese President Xi Jinping visit the "Ocean" All-Russian Children's Centre in Vladivostok, Russia September 12, 2018. Mikhail Metzel | TASS | Reuters