I can try to help a bit, but I'm no gunsmith
and many smiths on this site have forgotten more than I'll ever know about the craft.
Have you tried removing the trigger from the receiver
to see if the safety lever moves freely when it is in no way contacting your receiver?
The part circled is your bolt stop release lever.
It mechanically lifts the bolt stop piece on a standard r700,
if it has no-side bolt release button on the physical receiver as your (r700 clone) Stiller already has.
You could also try removing the lever entirely by removing and replacing both that screw and moon clip in the middle of it (not the two outside the lever on the housing).
But I don't know why it would be affecting the functionality of your safety.
The specific area that you circled that is broken is just a small bent piece of cheap metal that touches & lifts the bolt stop,
which again, is not present on your action.
It is just floating there doing nothing basically.
How did it break? It may have stressed some other area when it occurred.