In Jan 2020, the Institute of International Finance (IIF) came out with a report (read summary here) that the total global debt is expected to climb to a new all-time high of more than $257 trillion in the coming months. According to this report, this includes debt across the household, government, financial and non-financial corporate sectors.
As per my understanding, these are the only sectors in the world economy and whichever sector borrows, it must borrow from some other sector. Then how can total global debt be non-zero?
Also from an accounting perspective, a loan or a liability in the books of one entity (borrower) would get reported as an asset in the books of some another entity (lender), then how could the balance sheet of the world economy (which is an assimilation of all the balance sheets out there) end up in red?