He retracts his move and plays at . Now Black cannot play at a because it is suicide, so White lives.
Fun problem! It took me a couple minutes to see how it could possibly work.
Arno: a second possible solution is that White's last move was a pass or tenuki :o)
ferdi: Sigh... Every time I show this problem around I hope that nobody would mention these 'solutions', but it never works :-) I completed the stipulations at Retractor Problems to exclude these possibilities.