Functionally, might take the form of recursive logic with feedback. Also known as a Neural Network.
From inside out... translate word. But thats not enough, take output, use as input and need to translate words 'meaning' in sentance. Then keep working outward into paragraph if necessary, and finally article.
In that case the 'dictionary' would just be a VERY WELL 'trained' Neural Network (one for each language)
Notice the article uses the word 'tags', too.