lol fifa rankings

[j0s]

http://www.telegraph.co.uk/sport/fo...-ahead-of-Italy-sixth-and-Portugal-fifth.html

England up to fourth in Fifa rankings after Euro 2012 ... ahead of Italy sixth and Portugal fifth
Despite bowing out of Euro 2012 at the quarter-final stages, following a penalty shoot-out defeat against Italy, England have remarkably climbed up to fourth in the latest Fifa world rankings – above the Azzurri and Portugal....

How does the rankings work? I would understand non European teams being lower as they haven't played in a tournament