The part shown would be difficult to make even with machine tools if you want straight, flat, and square sides. Add a flat bottom and it is nearly impossible. The best way would be by sinker EDM. A graphite electrode would gradually burn a square hole to the required depth. Another approach would be by 3D printing with sintered metal. In either case, the cost of the equipment is huge.
Regarding manually making the hole, I have never seen a file with a truly sharp edge. Also, files don't work well in blind holes. Personally, I would modify the design to make the part more machining friendly.