By Paul Sandle

LONDON (Reuters) -HMD Global, which makes Nokia-branded phones, has become the first major smartphone company to manufacture devices in Europe with its first made-in-Hungary 5G model, aimed at data security-conscious customers, now available for purchase.

"We are thrilled to be manufacturing the Nokia XR21, our signature rugged 5G smartphone, in Europe," HMD Global co-founder, chairman and CEO Jean-Francois Baril said on Tuesday.

Before HMD opened its Hungarian operations, Europe had no large-scale smartphone manufacturing as major companies like Apple and Samsung make their phones in Asia to keep costs down.

Most of Apple's iPhones are made in China, a key market for the U.S. company. However, concerns over national security have come to the fore in recent years, prompting the U.S. to place technology sanctions on Huawei's mobile business, while China expanded curbs on the use of iPhones by state employees.

"We are dedicated to investing in security, technology and manufacturing processes that make our devices more secure and longer lasting," Baril said.

HMD said the first European model was designed for enterprise customers, some of whom had requested additional security in conjunction with their IT security partners.

The company already stores data in the European Union, with consumer and corporate data from all of its smartphones held and processed on servers in Finland since 2019.

HMD signed an exclusive 10-year licensing agreement with Nokia Oyj, once the world's largest phone maker, in 2016 to make Nokia-branded smartphones and tablets.

It said in March it would start manufacturing in the European Union, which has been encouraging companies to set up production in key sectors such as semiconductors.

The Nokia XR21 European edition is priced from 649 euros, or 549 pounds, the company said.

A limited edition of 30 units from the European production line in frosted platinum will be available for purchase from the company's website from 699 euros or 599 pounds, it said.

(Reporting by Paul Sandle; Editing by Bernadette Baum)