A statement, once made, cannot actually be retracted. It is made, it remains made and cannot be un-made.
A "retraction" statement is simply a second or subsequent statement which denies some of all of the contents of the first. For example:
Statement One: "I saw Fred hit Bert in the face. He hit him with his right hand on the left cheek"
Statement Two: "I now say I did not see Fred hit Bert and can give no details of the event"
The prosecution now has two statements and it will be for them to decide how to proceed. So it will be in your case. They may decide that the witness should still come to court. She may be declared a "hostile" witness and may be cross-examined on both her statements and be asked to explain the substantial difference between them. Many people think that retracting a statement is a simple matter and the end of their involvement. They are often very much mistaken and far from being the end of their troubles, is often only the beginning.
Making a false statement to the police is a specific offence (there is a warning to this effect on standard witness statement forms). Such action may also be accompanied by allegations of wasting police time or attempting to pervert the course of justice, depending on the circumstances.