In this paper, we present an optimization model based on cost minimization for traffic engineering of multirate and ATM networks with switched virtual circuits (SVC's). There is an increasing interest for efficient traffic engineering methods for routing and dimensioning of large and robust multiservice networks. In the case of ATM and other types of packet multiservice networks, traffic engineering requires ressource allocation and performance optimization at the cell or packet level in order to assure a satisfactory grade of service (GoS) at the call level to the users. Therefore, we are interested in networks with switched connections that are flexible enough so that planners may offer cost-effective networks with guaranteed GoS even in the event of important failures. The model integrates the notions of QoS, GoS, failures and failure propagation between the physical and the logical level as well as circuit routing.